Draft regulations amending the Community Infrastructure Levy ("CIL") Regulations were laid before Parliament yesterday (15 October 2012) and have been published today. The main changes relate to section 73 variations to a planning permission so that CIL would not be payable twice for the same development, and confirm that CIL will not be payable on planning permissions replacing extant and unimplemented permissions granted before 1 October 2010.

The amended CIL Regulations will be fast-tracked through Parliament and are expected to come into force around mid November 2012 (without consultation, due to their technical nature).  The Regulations will not apply retrospectively.

The Planning team at Herbert Smith Freehills LLP is in the process of reviewing in detail the proposed changes to the Community Infrastructure Levy ("CIL") regime. The main proposed amendments are outlined here:

Section 73: removal of double charging

Under the current CIL Regulations, CIL may be payable on a s.73 permission as well as on the original planning permission. The new draft Regulations change this so that if a charging schedule is in place both at the time the original planning permission is granted and the time a s.73 permission is granted, CIL will be payable only once, according to the following rules:

  • if the CIL charge calculated at the time of the original permission is the same as the CIL charge calculated at the time of the s.73 permission, CIL will be payable on the chargeable development under the original planning permission only;
  • if there is a change in the CIL charge between the original planning permission and the s.73 permission, and if that change is due to a change in a condition under the s.73 permission, CIL will be payable only on the chargeable development which is the most recently commenced or re-commenced chargeable development;
  • for the purposes of these s.73 calculations, the date on which the s.73 permission 'first permits development'  should be regarded as the same as the date at which the 'planning permission first permits development' for the original permission.

If a CIL payment has already been made in relation to the original permission, and the charging authority issues a new liability notice in relation the s.73 permission because the CIL liability has changed, it will be possible to off-set the CIL already paid against the new CIL charge.

Transitional provisions provide that if a planning permission is granted when there is no CIL charging schedule in place, and a later s.73 permission is granted when there is a CIL charging schedule in place, the CIL charge will be:  CIL payable on the chargeable development under the s.73 permission minus the CIL that would have been payable under the original permission (using, for purposes of calculation, the charging schedule in force at the time of the s.73 permission).  Therefore a CIL charge will only be incurred if the s.73 permission results in an increase in CIL payable.

Replacement Permissions (extension of time to implement) do not attract CIL

'Replacement' planning permissions can be granted where the original permission was granted on or before 1 October 2010 and is still extant and unimplemented (under article 18(1) of the (Town and Country Planning (Development Management Procedure) (England) (Amendment No 2) Order 2012).  CIL will not be chargeable where the original permission was granted before a charging schedule was in place and the replacement permission is granted (under Article 18(1)) when a charging schedule is in place.

 Development under 'neighbourhood development orders' will attract CIL

The CIL Regulations will apply to development consented under a neighbourhood development order (under s.61E of the Town and Country Planning Act 1990, as amended by the Localism Act 2011), meaning CIL is potentially payable.

Formula

The amended Regulations correct an error in the formula in Regulation 40 so that there will be no overcharging for development involving the retention of some existing buildings and the demolition of others.

The Regulations are in draft form

The impact of the amended provisions, if they come into force, will remain to be seen in practice. The Department for Communities and Local Government are already receiving a number of technical queries regarding the draft amendments, and it is possible there may be some further changes before they come into force.

The draft CIL (Amendment) Regulations 2012 can be viewed here.